BLUE HOUSE PREVIEWS U.S.-ROK SUMMIT MEETING: FTA

C O N F I D E N T I A L SEOUL 002674 SIPDIS SIPDIS SYDNEY FOR POTUS APEC DELEGATION PASS USTR FOR CUTLER AND AUGEROT STATE FOR E, EEB,EAP/K, AND EAP/EB USDOC FOR DUTTON, CARTER-NIXON AND CHOI TREASURY FOR IA/OASIA/POGGI USDA FOR FAS/ITP.CLAUS AND GRUNENFELDER NSC FOR TONG E.O. 12958: DECL: 09/04/2017 TAGS: AS EAGR ETRD IN KS PREL SUBJECT: BLUE HOUSE PREVIEWS U.S.-ROK SUMMIT MEETING: FTA AND BEEF DELIVERABLES REF: SEOUL 1127 Classified By: Amb. Alexander Vershbow. Reasons 1.4 b/d. ¶1. (C) SUMMARY: At the September 7 APEC bilateral summit meeting in Sydney, President Roh will inform President Bush that Korea has presented the U.S.-Korea FTA (KORUS FTA) to the National Assembly for ratification just prior to the meeting, a key Blue House economic adviser told us September ¶4. Roh will reaffirm his strong commitment to reopen the Korean market to U.S. beef as soon as possible and to seek the KORUS FTA's passage before he departs office on February ¶25. The official added that President Roh's "if-asked" talking point on full beef market reopening is to request reciprocal U.S. actions to obtain similar beef market openings in Hong Kong, Japan and Taiwan, thereby giving the ROKG greater political cover. END SUMMARY. ¶2. (C) September 4, EMBOFFs met again with Presidential Assistant Secretary for Economic Policy Kim Seung-ho (strictly protect),the official responsible for preparing the economic portion of President Roh's briefing book for this week's APEC Economic Leaders Meeting. Kim is a valued contact who provided us insights into Blue House thinking on the KORUS FTA and the beef issue in an earlier meeting (reftel). FTA GOING FORWARD AS PLANNED -------------- ¶3. (C) Kim opened by saying that the FTA was on President Roh's desk for likely signature today and was slated to go to the National Assembly (NA) September 6 or 7. Later in the conversation, Kim said that President will inform President Bush in their September 7 bilateral on the margins of APEC that the ROKG has presented the agreement to the NA for ratification. ¶4. (C) Kim said the Blue House will continue to push for ratification in this NA session, ideally by the end of November prior to December's Korean presidential election. A second scenario is to ratify after the presidential election but before the new president takes office on February 26. The Blue House is still weighing timing, Kim said, and must decide whether it seems advisable from a political standpoint to delay a ratification vote until after the presidential election. However, Kim stressed that President Roh is seeking ratification in this session, to ensure that the FTA is regarded as his achievement and not his successor's. ¶5. (C) Noting that NA elections will follow the Korean presidential elections, A/ECOUNS suggested that NA ratification in November appears less complicated. Kim said the ROKG may opt for that timing. He added that the ROKG understands that the USG is trying to persuade a vocal minority not to oppose the FTA, and may wait until there is a friendly environment in Congress before sending up the FTA. We recounted ongoing, stepped-up outreach efforts by the Administration and private sector supporters on behalf of KORUS FTA. "READY TO MOVE" ON BEEF, BUT... -------------- ¶6. (C) We highlighted the resolution of the beef issue as critical to improving Congressional receptivity to the KORUS FTA. Kim responded that Korea is ready to open its market to U.S. beef, but that Korea's ability to do so depends on the U.S. side. Every time Korea is ready to move, Kim said, something happens on the U.S. side (i.e., bone or other materials are found in U.S. shipments that are inconsistent with Korea's current boneless-only import protocol). Kim said the ROKG understands that the problems are largely due to human error, but asked that the U.S. take measures to stop these -- at least for another two to three months -- because beef import compliance problems hand FTA opponents an issue and allow them to become more vocal again. ¶7. (C) AGATT said the U.S. will be looking for Korea to accept beef and beef products from animals of all ages. Kim responded with some skepticism. If Korea immediately moved to simply adopt OIE guidelines completely with no deviation, consumers and NGOs would question why the ROKG spent so much time negotiating on this issue. This is a big issue for Korea, Kim stressed. Kim said the August 31 change of MAF Ministers opened a prospect of revising the import protocol in the next few weeks and reopening the market within two to three months. The new MAF minister "knows that beef is the first thing he must think about every morning," Kim said. ¶8. (C) In phoning a veterinary health contact to find out whether an August 31 meeting of the ROKG animal health committee had completed its risk assessment (part of the roadmap toward revising the protocol),Kim learned and conveyed to us that another bone had been found in a shipment. (FYI: The September 4 bone finding was from Swift plant 969G in Greeley, CO, already suspended since July 31 due to another bone finding, not classified as an SRM. MAF has already told us they will continue to accept product from this plant shipped prior to July 30. END FYI.) Kim ended this portion of the conversation by saying that Korea is ready to accommodate the U.S. on the beef issue, but "please pick up those small bones." ¶9. (C) When the conversation later turned to APEC, Kim said President Roh will tell President Bush at their September 7 bilat that Korea is ready to address U.S. concerns on beef. Roh will have an if-asked talking point on beef bones, Kim said, stressing "please do the same with Korea's neighbors" such as Japan and Taiwan, if the U.S. wants Korea to revise its beef import protocol to include all beef cuts and ages. APEC Issues -------------- ¶10. (C) Turning to APEC issues, on global climate change, the adviser described Korea as straddling U.S. and EU approaches with "a foot in two boats." As a result, the ROKG would follow the debate and perhaps join a consensus position, but not take the lead on climate change. On APEC membership, he said that Korea will join any consensus in favor of extending the moratorium, and not support a possible Australian effort on behalf of earlier Indian membership. At the same time, the ROKG will urge APEC leaders not to defer the membership discussion indefinitely. COMMENT -------------- ¶11. (C) Kim was upbeat about FTA ratification but frank about potential difficulties in revising the beef import protocol. It was encouraging to hear that the KORUS FTA will be submitted to the NA this week, as a deliverable for President Roh's bilateral with President Bush. On beef, on the other hand, Kim did not have any viable suggestions for getting past the current difficulties caused by U.S. shippers' occasional noncompliance with Korea's import protocol (which is stringent beyond OIE standards). Furthermore, he made clear that the ROKG still feels vulnerable to consumer and NGO pressure if it moves too quickly to scrap the current beef import protocol. While Kim stressed that the new MAF Minister understands the need to resolve the beef issue to facilitate Congressional action, he indicated that Korea's market might not reopen until November. VERSHBOW